Government in major U-turn on pick-up truck tax changes

Just a week after announcing it, HMRC has scrapped its plans to axe the benefit-in-kind 'loophole' for double cab pick ups.

Last week, the Treasury announced that from 1 July this year double-cab pick-ups would no longer be taxed as goods vehicles, but would instead be classed as cars for the purposes of calculating capital allowances and benefit-in-kind (BiK) liabilities for drivers.

This would have closed a perceived 'loophole' where the current good vehicle classification allows employees and company directors to benefit from private mileage in company-owned pick-up trucks, while avoiding thousands of pounds of company car benefit-in-kind’ tax.

In an announcement on Monday 19th February 2024, the government says it has "listened carefully to views from farmers and the motoring industry on the potential impacts of the change in tax-treatment".

The government has acknowledged that the 2020 court decision and resultant guidance update could have an impact on businesses and individuals in a way that is not consistent with the government’s wider aims to support businesses, including vital motoring and farming industries.

HMRC announced that its existing guidance will be withdrawn, meaning that Double Cab Pickup Trucks will continue to be treated as goods vehicles rather than cars, and businesses and individuals can continue to benefit from its historic tax treatment.

Internet link: GOV.UK